Adaptive Model-Predictive Climate Policies in a Multi-Country Setting

Thierry Bréchet (), Carmen Camacho and Vladimir Veliov ()
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Thierry Bréchet: CORE et Louvain School of Management
Authors registered in the RePEc Author Service: Thierry Bréchet

Documents de travail du Centre d'Economie de la Sorbonne from Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne

Abstract: The purpose of this paper is to extend the use of integrated assessment models by defining rational policies based on predictive control and adaptive behavior. The paper begins with an review of the main IAMs and their use. Then the concept of Model Predictive Nash Equilibrium (MPNE) is introduced within a general model involving heterogeneous economic agents operating in (and interfering with) a common environment. This concept captures the fact that agents do not have a perfect foresight for several ingredients of the model, including that of the environment. A version of the canonical IAM (DICE) is developed as a benchmark case. The concept of MPNE is then enhanced with adaptive learning about the environmental dynamics and the damages caused by global warming. The approach is illustrated by some numerical experiments in a two-region setting for several scenarios

Keywords: Integrated assessment; adaptive behavior; learning; climate change (search for similar items in EconPapers)
JEL-codes: C61 E61 O13 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2012-04
New Economics Papers: this item is included in nep-ene, nep-env and nep-res
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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http://mse.univ-paris1.fr/pub/mse/CES2012/12029.pdf (application/pdf)

Related works:
Working Paper: Adaptive model-predictive climate policies in a multi-country setting (2012)
Working Paper: Adaptive Model-Predictive Climate Policies in a Multi-Country Setting (2012)
Working Paper: Adaptive Model-Predictive Climate Policies in a Multi-Country Setting (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:mse:cesdoc:12029

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